Disappeared News

Friday, January 21, 2011

There’s a bill about to be introduced by Republican Representative Gene Ward and others that would seek to establish a Hawaii “ferry system special fund” and re-acquire the two failed Superferry vessels at state expense this time.

The bill has several flaws (which could, of course, be ironed out during its passage through the committees), but the most fundamental flaw is insurmountable: it assumes that money will actually be deposited into a special fund by a ferry service that can’t make a profit.

Hawaii Superferry entered bankruptcy with a large debt. According to outside estimates, the operation rarely if ever made money. Even though it waived the fuel surcharge and so was selling tickets at a discount, it couldn’t interest enough passengers to pay its expenses. That’s how a business goes bankrupt.

So this bill would simply pump state funds into running an overlarge ferry system that (if the same vessels are used) would still have a barf problem and would still need to operate at a loss.

Now, it’s not unreasonable for a government body to underwrite transportation as a service to the public. Just as long as they know what they’re doing. For example, New York City pays the entire cost of the Staten Island Ferry. That’s right, it’s free.Travel in the Portland OR city center is free.

Mayor Mufi Hannemann did not look so smart when it was discovered that his TheBoat service, supposedly the answer to the Leeward commute, cost the city $120 for each $4 round-trip ticket sold.

The proposed bill would create an expensive new authority to supervise an operation looking very much like the failed Hawaii Superferry but top-heavy with state employee management.

While it’s surprising that Hawaii does not have some kind of interisland passenger service, repeating a failed attempt just doesn’t seem like a way to make progress. Particularly in a recession, is this the time to embark on a new, potentially ruinous, boondoggle?

Is somebody nuts here? This was a failed business venture and "Mr. Republican" Gene Ward wants government to take it over at taxpayer risk? How does this fit into the Republican platform of privatization of government services? Is somebody nuts here?

The House Transportation Chair, Joe Souki, supported the ferry all along, so it's possible, even likely, that he will hear the bill. However, I doubt that it will pass the House and, if it did pass, would not predict it to even get a hearing in the Senate.